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CHR Industry Perspectives, No. 1, September 2

The Power o Personal Service:Why It Matters • What Makes It Possible• How It Creates Competitive Advantage

by Barbara M. Talbott, Ph.D.Executive Vice President, Marketing, Four Seasons Hotels and Resorts

www.chr.cornell.e

Industry Perspectives:

A white pAper series from Cornell University



Industry Perspectives, No. 1 (September 2006)

Single copy price US$50

© 2006 Cornell University

CHR Reports and other publications are pro-

duced or the beneft o the hospitality industry

by The Center or Hospitality Research at Corne

University

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Cornell University School o Hotel Administratio

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Phone: 607-255-9780

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www.chr.cornell.edu

Advisory BoardJa C. A, Executive Vice President, Wines,Southern Wine and Spirits o New York

sc Ba, U.S. Advisory Leader, Hospitality and Leisure Practice,PricewaterhouseCoopers

ra Bck, Managing Director and Chie Executive Ofcer, Taj Group o

Hotels, Resorts, and Palaces

sc B, Chie Operating Ofcer, SynXis Corporation

la Caa, Ph.D., Associate Proessor and Editor o Cornell Hotel and Restaurant Administration Quarterly , Cornell University

raj J. Caa, Director o Strategic Planning, WimberlyAllison Tong & Goo

Ca A. ez, Ph.D., Associate Dean or Industry Research and Aairs, and LouisG. Schaeneman, Jr., Proessor o Innovation and Dynamic Management, CornellUniversity

K fzack, President,

AIG Global Real Estate Investment Corp.

U J, Chairman and Managing Director,Kohinoor Group

J-A Ku, EVP Human Resources, Travelport

mak v. la, President, Smith Travel Research

suza r. m, Managing Director, HVS International

la C. pbu, Chairman and CEO, The Thayer Group o Companies

Ag sa, VP o Marketing or Healthcare and Hospitality, JohnsonDiversey

Jac l. scab, Managing Director, Marsh’s Hospitality Practice

Ju A. sgua, D.B.A., Dean, Cornell-Nanyang Institute

Babaa tab, Ph.D., EVP Marketing, Four Seasons Hotels and Resorts

ea r. wa, Ph.D., President, Nestlé R&D Center and Nestlé PTC NewMilord

The Robert A. and Jan M. Beck Center at Cornell University

Cover, top row: Rama Chanani ’08; bottom row: Dave Gogolak ’97, Greg Medow ’95, and Mark Nicandri;

Meredith Barker ’04; Michael Zanolli ’93, Greg Sheets ’93, Rebecca Ratner ’97, and Mark Birtha ’94;

Proessor Dan Quan, Real Estate and Finance.



Senior Partners

JohnsonDiversey

Southern Wine and Spirits o New York

Taj Hotels Resorts Palaces

Partners

AIG Global Real Estate InvestmentFour Seasons Hotels and Resorts

HVS International

Kohinoor Group

Marsh’s Hospitality Practice

Nestlé

PricewaterhouseCoopers

Smith Travel Research

SynXis, a Sabre Holdings Company

Thayer Group o Companies

Travelport

Wimberly Allison Tong & Goo

FriendsARAMARK • Caribbean Hotel Restaurant Buyers Guide• DK Shiet & Associates • ehotelier.com • EstrelaMarketing Solutions • Fireman’s Fund • 4Hoteliers.com • Gerencia de Hoteles & Restaurantes • Global HospitalityResources • Hospitality Conections • Hospitality Financial

and Technological Proessionals • hospitalityInside.com• hospitalitynet.org • Hotel Asia Pacifc • Hotel China • HotelExecutive.com • Hotel Interactive • Hotel Resource • International CHRIE • International Hotel and RestaurantAssociation • International Hotel Conerence • iPerceptions• KPMG Japan/Global Management Directions • LodgingHospitality • Lodging Magazine • PKF Hospitality Research• Resort+Recreation • The Resort Trades • RestaurantEdge.com • Shibata Publishing Co. • Taste & Travel • The LodgingConerence • TravelCLICK • UniFocus • WageWatch, Inc. • WiredHotelier.com

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TheCenterforHospitalityResearch•CornellUniversity

ABoUt the AUthor

Te Power o Personl Service:Why It Matters

What Makes It Possible

How It Creates Competitive Advantage

Babaa m. tab, Ph.D., is Executive Vice President—Marketing or Four

Seasons Hotels and Resorts and a member o the Advisory Board o The Center or

Hospitality Research. A recognized leader in branding and strategy or service or-ganizations, she has been named 2007 recipient o HSMAI’s Albert E. Kohl award

or lietime achievement in marketing. The author o “Looking Ahead: Marketing

Luxury Hotels in the 21st Century,” she has also written and spoken on the topic

o service as a competitive advantage in a wide range o industries, including hos-

pitality, fnancial services, health care, retailing, and travel. Her work has ocused

on understanding consumer needs in the global economy, and how companies

can proftably meet those needs through dierentiation, innovation and eective

marketing.

By Brbr M. lbott, Ph.D.



CHRIndustryPerspectives•September2006•www.chr.cornell.edu

T

he innovtive denition o luxury developed over the pst 45 yers by Four Sesons Hotels nd

Resorts is bsed on service excellence, elded with top-notch cilities nd opertions. Four

Sesons begn by ocusing on wht ws then sll segent o the rket—the uent

requent trveler—nd in the process, built globl luxury brnd. As the experience o FourSesons deonstrtes, personl service cn be source o superior protbility, reputtion, nd growth.

Four Sesons’ success depends on choosing eployees who provide service tht is genuine nd

innovtive, on developing stndrds tht re both eningul nd exible, nd on intining unique

culture tht kes delivery o both possible.

exeCUtive sUmmAry



6 TheCenterforHospitalityResearch•CornellUniversity

Chr indUstry perspeCtives

strtegist Michel Porter hs dened s true copetitive

dvntge: the bility to deliver distinctive benets or which

custoers will py ore, over tie, becuse those benets

re highly vluble nd dicult to iitte.As Porter hs written,

• A copny cn outperor its rivls only i it cn estb-

lish dierence tht it cn preserve;

• Copetitors cn quickly iitte ngeent tech-

niques, new technologies, nd input iproveents;

• Te ost generic solutions—those tht cn be used in

ultiple settings—diuse the stest; nd

Wht kes luxury hotel experience “the best”? Wht do guests wnt ost, nd

how cn hotels respond successully? Te nswer to both questions y well lie

in the qulity o personl service. Given their pressured liestyles, nothing t-

ters ore to uent consuers. Nothing is ore dicult or hotels to deliver or

potentilly ore dierentiting. While innovtions in hotel design nd style, technology, nd personl

enities will lwys be iportnt, nothing coes closer thn personl service to providing wht

Te Power o Personl Service:Why It Matters

What Makes It Possible

How It Creates Competitive Advantage

By Brbr M. lbott, Ph.D

• Copetitive strtegy is bout being dierent...choosing

to peror ctivities dierently or to peror dierent

ctivities thn rivls.1

Porter’s yrdstick is tiely one or luxury hotels toconsider. Dend is strong nd consuers’ choices re in-

cresing. As new oerings pper nd existing ones continue

to evolve, it becoes ore iportnt thn ever to estblish

dierences tht re eningul; dierences tht will llow

hotels to void cooditiztion nd deliver preiu

results or the long ter.

1Michel Porter, “Wht Is Strtegy?,” Harvard Business Review, Nove-

ber–Deceber 1996, pp. 62-64.



Four Sesons Hotels nd Resorts ws ounded in 1961

nd hs sought ever since to ke personl service its

distinguishing copetitive dvntge. Experience since then

would indicte tht personl service cn nd does ulll

Porter’s dictu. Service which is both highly relible nd

eotionlly stisying lls brod rnge o iportnt needs

or uent trvelers in wy tht is dicult to do. Unlikephysicl ssets, service is the product o people, systes

nd culture, which re dynic nd creted over longer

periods o tie. Service depends on ny integrted ctions,

including how eployees re chosen nd nged nd how

stndrds re creted nd tught. Copeting on service is

n investent in the qulity o st nd guest experience,

which over the history o the copny hs been the source

o superior protbility, reputtion, nd growth.

Wht ollows is drwn ro tht experience. It is ent

to uel nd urther the dilogue bout personl service,

nd why it y be the single ost powerul wepon in

copny’s copetitive rsenl: becuse it is so iportnt toconsuers; becuse it is so dicult to deliver; nd becuse

it cn be dierentited in so ny wys, ultitely shping

innovtion tht ensures sustinble dvntge.

TheImportanceofPersonalService:Why It MattersIn recent yers nuber o trends hve converged, k-

ing personl service ore powerul vlue proposition nd

dierentitor thn ever beore. Periods o rpid chnge nd

rising uence hve occurred throughout history. Tis tie,

however, the pce o lie—its opportunities nd chlleng-

es—hs ccelerted in wys tht even successul people nddicult to control.

rditionlly, incresed welth hs brought greter

sense o power over circustnces, reoving brriers to

hppiness; enhncing opportunities to purchse, to grow,

nd to give in wys tht re eningul. Becuse tie is the

one thing which oney cnnot buy, it is the gret exception

to this rule. Tis hs lwys been true, but is now ore elt

thn ever—nd tht eeling is reected in consuer pur-

chse priorities.

Te world is now t, s Tos Friedn hs recently

written, 2 nd this hs reoved brriers in dierent, ofen

disepowering, wy.

CHRReports•July2006•www.chr.cornell.edu

m a ac cg a uu

• The hotel oers impeccable service ............................... 9.5

• The hotel is welcoming .................................................. 9.4

• The hotel is consistent in providing an experience that

meets or exceeds my needs ........................................... 9.4

• Oers an overall hotel experience that I would enjoy

very much ...................................................................... 9.3

• Oers service that is truly personal, recognizing the

needs o the individual .................................................. 9.2

• Oers service that leaves me eeling understood,

pampered and rejuvenated ............................................ 9.1

Note: Importance Rating Average Maximum = 10.0.

2Tos L. Friedn, Te World is Flat: A Brie History o the wenty-

First Century (New York: Frrr Struss Giroux, 2005). Friedn ex-

ines “the ten orces tht ttened the world, including Septeber 11, 2001,

the ll o the Berlin wll, nd chnges in technology (e.g., work-ow sof-

wre nd open-sourcing), which ostered new globl copetitive odels.”

In Friedn’s view, these hve creted new pressures on ntions, cop-

nies nd individuls—including his own young dughters. “My dvice to

the in this t world is brie nd blunt: Girls, when I ws growing up,

y prents used to sy to e, ‘o, nish your dinner—people in Chin

nd Indi re strving.’ My dvice to you is: Girls, nish your hoework—

people in Chin nd Indi re strving or your jobs.” (p. 237).

In t world,• Tere is no snctioned downtie. Work cn nd does

cll t ny oent on the 24/7 globl clock ;

• In every industry, perornce brs re lso set globlly

nd constntly rised; nd

• Te results re new levels o personl nd work-relted

stress, long with sense o tie poverty, even or the

uent.

Tis is evident in the opinions o requent, successul

U.S. trvelers surveyed by Four Sesons.3 Tey overwhel-

ingly gree tht:

• I working hrder thn ever ............... ............... .. 76%

• I never hve enough tie ................ ............... .......... 65%

• I hve gret del o stress in y lie............... .......63%.

Te widening rnge o personl choice only copounds

these tie pressures. rvel is cse in point. For gener-

tions, Aericns who could ord it shuttled sesonlly

between estblished destintions, Florid nd New Englnd

or North Esterners, s n exple. Tey styed in privte

hoes, or t ew storied resorts known or their exclusivity.

ody the long weekend in London or Pris is coonplce,

s incresingly is the trek to ibet or Bhutn. Unique trvel

3Results re bsed on 479 copleted interviews with uent requent

trvelers, conducted vi e-il in Jnury nd Februry 2004. Te study

ws pid or by Four Sesons nd conducted by n independent reserch

r. No hotel copny ws identied s sponsor o the reserch. On

verge, prticipnts trveled ve or ore t ies per yer on business or

plesure, pying t lest $250 or ore per night or hotel. Teir experi-

ence, knowledge, nd preerences encopssed wide rnge o hotels nd

brnds. Four Sesons hs conducted siilr independent reserch peri-

odiclly or ny yers. Tese results re consistent with those ndings.



TheCenterforHospitalityResearch•CornellUniversity

experiences re ore coveted nd vilble thn ever, even

s tie hs becoe ore scrce.

Wider choices nd wider trvels, lso rise questions

tht were not experienced in the old ilir plces: issues

o recognition; suitbility to one’s needs; nd the bility to

deliver coort t ll levels, both physicl nd eotionl.

Tese concerns re not liited to leisure trips, s business

trvelers ce the se concerns or dierent resons. Hv-ing lef both personl nd proessionl support systes

behind, their chllenge is to ccoplish iportnt business

gols in incresingly diverse nd dending circustnces.

ChoosingaLuxuryHotel

A ne hotel cn do uch to reduce these inevitble stresses,

by oering solutions to ensure coort, convenience, nd

control. It cn lso help trvelers to itigte the bsolute

scrcity o their tie by king the ost, nd best, o the

tie they do hve. Tt this hppens ost o ll through

personl service is evidenced by the priority guests the-

selves plce upon it.Tis ct is reected in the Four Sesons reserch. Given

choice o ny ites, requent trvelers overwhelingly

rted the six service-relted ctors shown in the ccop-

nying box s the ost iportnt in choosing luxury hotel.4

Indeed, service is driving otivtion or uent

consuers in broder sense s well. As this se reserch

reveled, n overwheling jority o the gree or strong-

ly gree tht: 5

• Personl service is the reson I choose ost o the

orgniztions I do business with ........................... 85%.

Responding to the needs o these trvelers in nunequlled wy is wht denes the best in per-

sonl service. As insights ro the uent-guest

reserch would indicte, this ens delivering

n experience which is both perornce-bsed

(e.g., “consistent;” “ipeccble”) nd eotionl-

ly stisying (e.g., “welcoing, enjoyble; service

which kes e eel ppered, rejuvented”).

• Perornce tters, becuse the tie crunch is here

to sty. As result, 24/7 liestyles dend true 24/7

service: coprehensive, relible, nd uncoproising.

By king the ost o tie, personl service helps to

ddress this ever-present source o stress, whether elt

s the need to be tie-ecient in the perornce o

business, or in the eqully pressing desire to ke the

ost o precious leisure tie.

• Eotion tters, becuse stress is lso here to sty —

driven not only by the tie crunch, but lso by welth

o choice nd by the enorced nonyity o ny

spects o odern trvel (e.g., the irport experience).

Personl service which delivers recognition, ressur-

nce nd respect in uthentic nd pproprite wys hs

prticulr power to itigte these dditionl sources o

stress.

A closer look t service in ction helps explin why tht

is so, nd lso why it is so dicult to deliver. It hs been

estited tht in 200- to 300-roo luxury hotel, there will

be s ny s 5,000 interctions between guests nd st

per dy; in other words, thousnds o opportunities or high

perornce or or ishp.6

As we hve seen, luxury hotel guests hve high ex-

pecttions. Tey need true 24-hour support: n ssurnce

tht whtever the hour or the request it will be responded

to quickly by soeone who tkes responsibility to crry

through. Tey lso expect exceptionl proptness nd c-

curcy: getting things right the rst tie, ost ties, nd

recovering well when istkes occur. Service necdotes

tend to highlight the exceptionl. Delivering consistently on

these bseline expecttions, however, y well be the ost

extrordinry service et o ll.Tis ws the concept or Four Sesons Hotel London

when it opened in 1971, redening luxury or the rst gen-

The greatest luxury or ourcustomers is time,and service can help themmake the most o that.

4 Ibid .5 Ibid .

6

Assues 250 roos t 75-percent occupncy with 235 guests in ll

(single to double occupncy ix t 50–50), nd 20 or ore st interc-

tions per guest per dy (e.g., door, bell, prking; PBX or phone; house-

keeping nd vlet; roo service, resturnts, nd brs; concierge, sp, gif

shop, reception; nd pool).



CHRIndustryPerspectives•September2006•www.chr.cornell.edu

ertion o globl executive trvelers. As Isdore Shrp, Four

Sesons Chirn nd CEO observed recently,

Te essentil question or us in the erly dys

ws: “Wht did our custoers vlue ost?”

Mrket reserch sid it ws luxury. And luxury

didn’t necessrily en elegnt surroundingsnd gouret els. When we looked closely, it

bece cler tht the gretest luxury or our

custoer ws tie, nd service could help the

ke the ost o tht. Giving the greter pro-

ductivity; greter enjoyent. Wht better luxury

could there be?7

Tt insight led to the world’s rst 24-hour luxury hotel:

one which operted on guests’ tieline rther thn dictting

its own; one tht nticipted services to ke their trvel

esier including round-the-clock in-roo dining; one-hour

pressing nd our-hour dry clening; nd fer-hours ccess

to retil shops nd other services nerby.With the iedite success o this concept in Lon-

don, Four Sesons hd the opportunity to grow—rst in

Wshington, D.C., nd then throughout the United Sttes. It

quickly bece pprent tht oering new level o service

dended ethods o opertion tht were eqully new nd

dierent, including how st would be selected, trined, nd

provided with n environent tht llowed the to excel; to

provide service which ws not only relible but lso eo-

tionlly stisying to guests.

DeliveringService:

Making Te Personal PossibleWht Four Sesons clls its unique service culture is bsed

on series o insights nd belies bout the person who pro-

vides the ct o service, nd the one who receives it. Te rst

o these is bout the people theselves—nely, tht the de-

sire to serve is innte, there to be discovered, nd not tught

by the hiring orgniztion. As Isdore Shrp hs observed,

We cn’t pre-check service or sple it—pro-

duction nd consuption re siultneous.

Tose ew oents o service delivery re

copny’s ke or brek point, when reput-

tion is either conred or denied. And theoutcoe in our industry norlly depends on

ront-line eployees: dooren, bellen, wit-

ers, housekeepers—the lowest pid people, nd

ofen, in too ny copnies, the lest oti-

vted. Most copnies hire or experience nd

ppernce, how the pplicnts t the copny

ige. We hire or ttitude. We wnt people

who like other people nd re, thereore, ore

otivted to serve the. Copetence we cn

tech. Attitude is ingrined.8

Tis thoughtul recruiting is core spect o Four Se-sons service culture, including ultiple interviews or every

position. In hotel, the lst o these is with the Generl

Mnger or Hotel Mnger. Te gol is to nd cndidtes

with the personl qulities nd vlues described bove. Pride

o ssocition with the best, pride in the qulity o one’s

work, nd one’s bility to contribute to te re other key

chrcteristics sought in this process.

For ny yers, Four Sesons hs tken cre to select

eployees who hve these qulities. Tey re successul

people serving successul people in wy tht is genuine nd

unpretentious—soething tht is now ore iportnt thn

ever. ody’s uent trvelers coe in wide vriety o ges

nd bckgrounds. Teir denition o gret service is person-

l—wht eels pproprite nd coortble to the. Tey

re less ipressed by the trppings o trditionl elegnce;

less likely to istke orlity or pretension or being well

served. Copre tht pproch to this ro Helen Fielding,

uthor o Bridget Jones’s Diary:

In the world o posh hotels, expensive service

doesn’t lwys en good service. You notice

this on U.S. book tour: iling to get the tten-

tion o sneering witer in knickerbockers who

eventully presents you with cold, horrid ood

under silver lid...9

Priscill Alexnder, President o Prorvel, who nu-

bers ny o these uent, requent trvelers ong her

clientele, puts it this wy:

Gret service eels less like n old-shioned but-

ler nd ore like personl ssistnt. It tkes

the right personlity to do this—intelligence is

iportnt. Condence, too. [Te service per-

son] hs to pper t the right tie nd know

wht’s required. You receive wht you need, but

you’re not conscious o exctly how tht hp-

pens. When you eel tht you cn depend on theservice to nticipte but not intrude, it llows

you to ully relx.10

7Isdore Shrp, Singpore Workorce Developent Agency, Leadership

Forum Address, October 27, 2005.

8 Ibid .

9 Helen Fielding, “Acts of Kindness,” Condé Nast Traveler, April 2001, p. 90.

10 P. Alexnder, Prorvel, interview held on June 28, 2006, during tele-

phone converstion t oronto, Ontrio, Cnd. Ms. Alexnder ounded

Prorvel Interntionl, Inc. in 1984 nd hs built it into copny tht

rnks ong the top 20 gencies in the industry. In 2004 she ws wrded

the op rvel Proessionl by Luxury rvel Expo, leding trvel

industry oru.




Wht else kes this possible? Given the right people, it

is trining nd stndrds tht cn help ensure ech service is

personl in the nner guests experience it—never rote or

echnicl.

TheRoleofStandards

In the decdes since the London hotel opened, Four Sesonshs developed service stndrds tht help ke tht pos-

sible; stndrds tht work becuse they reect both the

guest’s needs nd the server’s individulity. Ech one briey

cptures severl things: why the service tters; wht level

o perornce is required; how tht perornce should

eel to the guest. ke check-in or exple:

Mission: o provide speedy, discreet, non-echnicl

nd hssle-ree rrivl or business trvelers; to provide

coorting nd luxurious rrivl or leisure trvelers.

• Te receptionist will ctively greet guests, sile, ke

eye contct nd spek clerly in riendly nner.

• Te receptionist will crete sense o recognition to

ech guest by using the guest’s ne in nturl n-

ner, nd by oering “welcoe bck” to return guests.

• Te registrtion process will be copleted within our

inutes, including queuing tie.11

In this nd in ll cses, Four Sesons stndrds re

intended s rod p, not script. Te phrse “spek

clerly in riendly nner,” or exple, encourges ech

receptionist to use words which eel nturl to hi or her.

It y see sll dierence to nge nd esure

service perornce in this wy, but wht lies behind it is

uch lrger: sense o trust. When copny’s reput-tion is de or lost on service, s Isdore Shrp observed,

trusting tht reputtion to the chrcter nd copetence o

individul eployees kes lrge stteent bout their

iportnce. reting the s they re sked to tret guests

plies the point even urther.

TheRoleofValues

In deling with eployees nd ll others, Four Sesons is

guided by philosophy sued up in the Golden Rule,

version o which cn be ound in ost world systes o

belie.12 Perhps or tht reson, it works well in ny situ-

tions where tht ight not be ssued—cross wide vriety o countries, nd even in cses where st were not

initilly selected through the ultiple interview process.

Atlnt is n exple o tht cse, where in Mrch

1997, Four Sesons begn to nge our-yer-old hotel in

idtown. As the third ngeent entity in the hotel’s brie

history, the new ledership te expected pprehension nd

concern ro the st: Would their jobs be secure? Wht

would chnge, nd how would they dpt? Te ocil hn-

dover occurred t idnight, with the rst shif o eployeesdue t 6:00 am. In preprtion, the new ledership te hd

rrnged to hve the st res pinted nd clened. Mn-

nequins dressed in new eployee uniors were set up in

locker roos. Hot coee nd donuts were redy nd witing.

Tt is wht greeted rriving eployees, long with hnd-

shkes nd ew words ro the Generl Mnger:

Welcoe to Four Sesons Hotel Atlnt. You’ll

see tht we’ve de ew iproveents. We

know tht uch ore needs to be done. As we

clen nd x soe guest res, we’ll continue

to upgrde st cilities s well. In tie, we

hope to becoe the best hotel in Atlnt. Tt’s

n bitious gol. We’re new here, nd I know

ties hve been chllenging or you. But we re-

lly believe this is soething we cn do together.

We’ll help. We’ll work hrd. But it’s ll o you

who will ke the dierence. You re the ones

who will ke guests eel tht we truly re the

best.

Little ore thn yer lter, Four Sesons Hotel Atlnt

becoe the city’s rst AAA Five Diond nd Mobil Five

Str Hotel— distinction it holds tody.13

Te Atlnt exple contins in brie ny eleentswhich cn be observed in 31 countries nd 70 Four Sesons

loctions ech dy: eningul cknowledgent o st

through epthy nd respect; leding through ctions

s well s words; setting high but chievble spirtions

in which every eployee cn tke pride. At Four Sesons,

Generl Mngers re key resource in this eort. Lrgely

prooted ro within, their verge tenure tody is ore

thn 16 yers. Products o the culture, they hve been ble to

recrete its spirit repetedly, in exible nd intuitive wys:

• In Singpore, the ngeent te used odest renov-

tion budget to ke the new st ceteri look nd eel

like reestnding resturnt, clled Kutulu;

11“Four Sesons Core Stndrds, April 1, 1999, ©Four Sesons Hotels

Liited.12Mrilyn E. Wilhel, Te Golden Rule, “Do unto others s you would

hve the do unto you.” Wilhel surizes this nd its equivlents

in nine itertions including the words o Zoroster, Buddh, Conucius,

Plto, Mhbhrt, Rbbi Hillel, Jesus, Muhd, nd Bhá’u ‘lláh,

1978.

13Te AAA Diond rtings or hotels represent cobintion o the

overll qulity, rnge o cilities, nd level o services oered by the

property. O the ore thn 55,000 AAA pproved properties in 2005, only

85 hotels received Five Diond designtion. (www..co//-

dionds/vediond.htl). Mobil rvel Guide uses strs to represent

levels o qulity, including its Five-Str certiction. O the ore thn

7,000 hotels Mobil rvel Guide rtes, in 2005 there were 25 Mobil Five

Str Hotels (obiltrvelguide.howstuworks.co/obil-trvel-guide-

rting.htl).



CHRIndustryPerspectives•September2006•www.chr.cornell.edu 11

WhatGuestsRemember

Erlier we sw how uent trvelers choose luxury hotel;

the iportnce o both eotion nd high perornce to

stisy their personl service needs. Pying preiu is one

wy they express stisction with Four Sesons service. An-

other is the stories they tke the tie to tell—in letters nd

e-ils, in rticles nd books; in web csts nd iproptuconverstions.

Mny o these stories re bout eories de on

personl trips nd vctions.

When young girl rrived t the Four Sesons

Hotel Sn Frncisco with her ther recently,

sestress t the hotel decided to surprise her.

Te sestress de ini crib or her dolls

ro wicker bskets, coplete with Egyptin

cotton bed skirts, sheets, pillows, nd blnkets.

Wht else do guests reeber? Unpretentious kindness,

or one. Tis ro Helen Fielding gin:

Once, when I ws stying t Four Sesons, L.A.,

riend used to visit e nd pull up next to the

Mercedes nd BMWs in the worst cr you’ve

ever seen, with dog cge in the bck, rusting

pnels, nd the buper lling o. Te vlets

used to be with delight nd ke treen-

dous uss o her. Tey still reeber y riend,

nd ondly sk fer her nd the cr.16

In recent yers ore guests’ stories reect eeling o

personl sety; sense o being cred or, s the result o

st ebers’ intuitive responses. For exple,

Te receptionist who nswered cll ro

won who bece lost while driving to

• St in Mui re encourged to recognize one nother’s

outstnding service to guests nd collegues, on

“Mui Mhlo” bord;

• In Atlnt the hun resources te creted “benets

concierge” to help eployees choose the best options

or the nd their ilies; nd

• When new lundry chine ws purchsed in Bli, it wsblessed in ccordnce with locl custo beore being

put into service.

Afer Septeber 11, 2001, Four Sesons did not respond

with widespred lyos. Generl Mngers were sked to

nd svings, but to do so wherever possible without elii-

nting jobs. St nd ngers were sked to oer their own

ides. Locl solutions vried. In Dlls, or instnce:

We hd single eployees who voluntrily

worked our dys per week so tht people with

ilies could work ve. Housekeepers worked

on the gol course. Eployees relly supportedone nother. 14

As ll these exples show, receiving personl service

powerully encourges the bility to pss tht service on to

others. Te perornce benets o this pproch include

lower turnover nd reputtion or being n eployer o

choice. Four Sesons Hotel Singpore hs been voted best

eployer in the country. For the pst nine yers, ever since

the inception o the wrd, Four Sesons hs been voted by

its eployees s one o Fortune gzine’s “100 Best Co-

pnies to Work For.”15 Te eotionl benets re kin to be-

ing prt o cring counity or ily, one tht includes

guests s well s st.

14

Crig Reid, Regionl Vice President nd Generl Mnger, Four Sesons

Resort nd Club, Dlls; “Custoer-ocused Corporte Cultures: Wht

does this Men? A Look Inside Four Sesons Hotels & Resorts”, in Nncy

Helstb, Mrch 31, 2006, p. 12.15

“100 Best Copnies o Work For 2006,” Fortune, Februry 27, 2006.

Four Sesons is cited s one o the 19 orgniztions in Fortune’s “Hll o

Fe.”

16Fielding, op.cit ., p. 95.17Fetured in series o webcsts in 2002 nd 2003, “Brnd Inside: Brnd

Outside,” Julie Anixter, oPeters! Copny. Ms. Anixter is the guest

who received the ssistnce ro st eber on her wy to Four

Sesons Hotel Wshington, D.C.

The Four Seasons servicestandards work because theyrefect both the guest’s needsand the server’s individuality.




Four Sesons Hotel Wshington. It ws riny

evening not long fer Septeber 11, 2001, nd

the guest ws lte or n iportnt eeting. Te

receptionist tried giving directions but quickly

relized tht wouldn’t work; there were too

ny turns nd too uch to reeber. Insted,

he guided her on the phone or the next 30 in-utes, becoing her personl GPS syste.17

Te nger t Four Sesons Hotel George V

in Pris, who recently gve her obile phone

nuber to other who ws leving her

dughter behind, to begin yer’s study in

Frnce. “I know she’ll be ne, but I worry,” ws

the other’s coent to the nger. “Plese

cll e ny tie,” ws the response. “And you

y give her the nuber too i you like, in cse

she needs soething.”18

In the ost extree cse, the eployees whorescued nd then sheltered guests in the Ml-

dives s tsuni swept wy uch o the Four

Sesons Resort Kud Hur in Deceber 2004.

Fortuntely, no one ws lost or seriously injured.

Flown to sety the next dy, ny guests hve

since written bout the speed nd selessness

o the response, crediting their survivl to the

ctions o the st.19

In turn, ny o these guests—long with Four Sesons

collegues round the world—contributed generously, to

rebuild the hoes o these eployees nd help sustin theirilies s the resort ws being rebuilt.

Even in uch less drtic circustnces, strong eo-

tionl connections re de when personl service is given

nd received. Tis is perhps becuse, or ll the chnges

tht technology hs brought, key hun needs rein: the

need or sety nd coort, sense o belonging, eeling

o being recognized nd esteeed.20 As Four Sesons Execu-

tive Vice President Ji Fitzgibbon hs observed,

For ost people, even n uneventul trvel

experience—one in which they don’t get stuck

in trc j nd their ights don’t get cn-

celed—is soewht tense. When they get bck

on the ground, they wnt to be soewhere

tht provides coort in style tht rers

who they re. Tey wnt, in other words, to be

greeted wrly, to be served proptly, to be

ppered.21

O course, not ll 5,000 interctions in ny given hotel

dy cn end hppily. Soe service ilures re repired

quickly, while guests re still t the hotel. Others, regret-

tbly, re not. In 2005 Four Sesons President Wol Hengst

received ore thn 3,000 letters nd e-ils ro guests.

Mny, but certinly not ll o the, were positive. Wht he

reebers is the pprecition or disppointent o indi-

vidul guests:

O course it lwys hurts when we get it wrong.

Te better we do, in ct, the higher guests’ ex-

pecttions, nd tht cn be two-edged sword.

But we own up to it honestly. Prt o the cultureis being huble, nd lling short on service—

which is bound to hppen despite our best

eorts—certinly helps us sty tht wy. I cll or

write to these guests ysel. Ech o the letters

nd e-ils is nswered personlly. Soeties

they’ll cll to thnk e or soething we hve

sent requent guest, s thnk you or their

business. It lwys surprises the tht I nswer

the phone ysel i I in. Tt’s wht our

Generl Mngers do s well.22

How Service Cretes CopetitiveAdvntge

ServicePays

We hve seen tht personl service is iportnt, distinc-

tive, nd eorble. But wht is its ipct on nncil

perornce? In the experience o Four Sesons, the eect

is powerul, prticulrly when copred with other choices

vilble to luxury hotel guests. Copeting on service

hs llowed Four Sesons to chieve nd intin overll

RevPAR (revenue per vilble roo) ledership in North

Aeric s reected below. Botto line results re notbles well.23

Tere could be ny resons or these results. Four Se-

sons believes they re driven by the ocus nd vlues which

18As told by guest, Hotel Ezr Cornell 81, April 8, 2006, Cornell Univer-

sity.19As written by guest to Isdore Shrp, Founder, Chirn, nd Chie

Executive Ocer o Four Sesons Hotels, 2004 Four Seasons Annual Re-

port , p. 3. “Let e stress tht your Group’s strength…rests on rock…Tis

rock is rstly de up o the…locl eployees who—while hving been

selected or doing their job well—hve shown in tie o utost crisis

their true vlue nd level o dediction tht no trining nd no ount

o oney cn every generte; it is innte nd ingrined in the.”20Abrh Mslow, oward a Psychology o Being (New York: John Wiley

& Sons, 1962).

21 Te Future o ravel. Four Seasons Four Decades, Ji Fitzgibbon, Execu-

tive Vice President, Opertions, 2001.22 W. Hengst, interview on July 10, 2006, in oronto, Ontrio, Cnd.23 Four Sesons gross operting prot (GOP) rgin ws 30.8 percent in

2005. Unlike RevPAR, GOP is reported dierently by dierent lodging

copnies nd brnds.



CHRIndustryPerspectives•September2006•www.chr.cornell.edu 13

led to developing its own style o personl service. Luxury

hospitlity is the copny’s only business. Tt hs creted

deep understnding o wht tters ost to guests nd

st. Te Golden Rule ethic hs been in plce or ny yers

s well, shping syste o stndrds, people, nd culturedesigned to eet well-understood needs.

Tis hs led to insights nd ctions which drive co-

petitive dvntge. Mny things which guests vlue gret-

ly—pproprite ne recognition, or exple—do not cost

ore to deliver. St who re pid in pride nd respect, s

well s copetitive wges, benets, nd prot-shring tke

s uch interest in cost ngeent s they do in serving

guests well.24

ContinuedInnovation

Along with superior results, ocus on personl service

cn lso point the wy to continuing innovtion which iseningul to guests nd dicult to duplicte. Fily trvel

is cse in point. A jor liestyle chnge or luxury hotels

in recent yers is the tendency or ilies to trvel to-

gether. Tis includes Mo or Dd, or both, nd one or ore

children, trveling or business or plesure. It lso includes

grndprents trveling with grndchildren, or with extended

ily groups. Wht ws essentilly rre nd sesonl whenFour Sesons introduced its rst children’s progrs in 1990

hs now becoe uch ore typicl.

A brod new rry o Four Sesons services hs

eerged in response, ro dedicted teen lounges nd teen

concierges to tilored enities, progrs, nd cilities

or toddlers, tweens, nd teens. While these re new nd

evolving oerings, the centrl insights behind the herken

bck to the Four Sesons service experience in London: tie

is precious; personl service ens tht children re guests,

too, with their own needs or recognition, ressurnce nd

respect; nd dults trveling with the still wnt to trvel

s light s possible in the circustnces. Tey lso wnt toshre the things they love bout trvel, including the discov-

ery o culture, the outdoors, nd resturnt dining. Finding

wys or the to do this esily nd hppily, while ensuring

n enjoyble experience or guests without children, hs l-

RevPAR PeRfoRmAnce

fu sa, rz-Ca, a uu

fu sa(U.s. )

rz-Ca (nAca )

o uu (Us. )

r e v p A r

( U s

d o l l a )

$260

240

220

200

180

160

140

120

100

Sources: Four Seasons and other luxury properties, Smith Travel Research; Ritz-Carlton, Marriott quarterly fnancial releases.

2000 2001 2002 2003 2004 2005

24 Jon Ktzenbch hs developed this thee t length in: “Why Pride

Matters More Tan Money” (Crown Business, 2003), the preise o which

is tht every gret copny is distinguished by the specil ttitude nd

coitent o its eployees. While onetry wrds hve otivtionl

power, Ktzenbch’s work would indicte tht it is brod-bsed eotionl

coitent which truly drives pek perornce.

25 “Best Rted Hotels or Filies,” Child , 2003.26Four Sesons ocus groups conducted Februry nd Mrch 2004, in

Chicgo, New York, nd Los Angeles with children, teens, nd prents.



lowed Four Sesons to becoe leder in serving this grow-

ing rket. As Child gzine hs observed, “Four Sesons

proves tht ‘upscle’ nd ‘ily-riendly’ re not utully

exclusive.” 25

Four Sesons people re the source o these innovtions;

they lso deliver the in distinctive nd genuine wy. In

the words o one young guest,“Tey know e by ne. I’ not n extension o y

prents. I’ y own person.”26

LookingAhead

Ultitely o course, the gol o innovtion is continued rel-

evnce—ttrcting new custoers over tie while retining

those who re lredy loyl. Four Sesons guest deogrph-

ics indicte tht this is hppening. In the study cited erlier,

the verge ge o Four Sesons trveler ws 43 yers, with

signicnt shre o those guests in their 20s nd 30s. In

ct this verge ge hs vried little or severl decdes.27 As

the Bby Booers turn 60, soe hve ssued tht rdiclly dierent hospitlity concepts will be dended, s Gener-

tions X, Y, nd Z tke center stge. It is given tht contin-

ued chnge ust nd will occur. In Four Sesons experience,

however, the ppel o personl service is not ge-specic.

It is ttitudinl. As the reserch lso shows, these ttitudes

re brodly ound in the luxury hotel rket’s ost desir-

ble guests: highly uent consuers o ll ges who trvel

requently nd well.

wo other viewpoints lso shed light on this issue. Te

rst coes ro recent Cornell study, “Are Your Stised

Custoers Loyl?,” by Judy Siguw nd Iselin Skoglnd,

which exines in detil series o ctors inuencing hotel

guests’ loylty. Tese include requent-guest points, qulity

o st, design, nd enities. As the study concludes,

...the ctor tht cused guests to be ost in-

volved in the purchse decision (nd thereore

ore interested in the hotel) ws its eployees.

Te ipliction is tht hoteliers ight consider

directing soe o their requent-guest expendi-

tures towrd strengthening hun resources.28

As the uthors went on to sy,

Well-trined st ebers who exude the

pproprite ttitude towrd service re invlu-

ble in keeping guests involved in the purchse

decision. .... Viewed sequentilly, ebers

o the hotel st heighten guest involveent,

which then produces greter ttitudinl loylty,

including less price sensitivity nd n intention

to be loyl. 29

Te second view coes ro Bill Fischer, President o

Fischer rvel Enterprises, in recent interview with Robb

Report gzine:

Te best thing bout Four Sesons is their

people nd the service they provide. Tey put

the right people in the right plces to use their

tlents. Te st bends over bckwrd to cco-

odte us. Even i the hotel is older nd there

re better ones in the re, it’s the Four Sesonsservice tht brings the guests bck ll the tie....

Four Sesons knows wht they re: Tey’re

ve-str hotel. Tey’re not building hotels tht

re our or our nd hl strs. At one tie,

Four Sesons nd Ritz-Crlton were running

hed to hed, but Four Sesons ew by the

becuse o the service.30

As both the Cornell study nd Fischer’s quote indicte,

cilities do tter, nd Four Sesons hs been leder in

this regrd s well. New hotels need to oer the kinds o

enities which re redening luxury tody, including desti-ntion sps. Estblished properties need to sty brest with

new guest roos nd suites, resturnts, nd resh design

detils. But will cilities lone dene the uture? Will it be

bout newer nd hipper, bout ore strs, or siply bout

ore? Te only certinty is tht guests theselves will let us

know. n

29Ibid ., p. 231.30 B. Fischer, in n interview with Drew Lisky or the rticle, “View ro

the op,” Robb Report: Te Icons and Innovators Who Defne Excellence,

30

th

Anniversry Issue, Jnury 2006. p. 320. Bill Fischer is one o the best-known luxury trvel gents in Aeric with one oce in New York. He is

requently quoted in the Wall Street Journal nd other publictions on the

subject o uent trvel.

27O the 479 respondents in the reserch o Jnury nd Februry 2004,

25 percent o the uent requent trvelers were 20 to 39, nd 34 percent

were 40 to 49. In siilr studies conducted since 1989, verge ge o

Four Sesons guest hs rnged ro 42 to 44.28Iselin Skoglnd nd Judy A. Siguw, “Are Your Stised Custoers

Loyl?,” Cornell Hotel and Restaurant Administration Quarterly, Vol. 45,

No. 4 (August 2004), p. 221.



2006 ReportsVol. 6, No. 11 A New Method orMesuring Housekeeping PerornceConsistency,by Michel C. Sturn, Ph.D.

Vol. 6, No. 10 Intellectul Cpitl: A Key Driver o Hotel Perornce,by Lind Cnin, Ph.D., Cthy A. Enz,Ph.D., nd Kte Wlsh, Ph.D.

Vol. 6, No. 9 Mndtory Arbitrtion:Why Alterntive Dispute Resolution My Be the Most Equitble Wy to Resolve

Discriintion Clis,by Dvid Sherwyn, J.D.

Vol. 6, No. 8 Revenue Mngeent in U.S.Hotels: 2001–2005,by Lind Cnin, Ph.D., nd Cthy A. Enz,

Ph.D.

Vol. 6, No. 7 Te Strtegic Vlue o Inortion: A Mnger’s Guide toProting ro Inortion Systes, by Gbriele Piccoli, Ph.D., nd Polo orchio

CHR ool 8 A Coprehensive Guide toMerchndising Bed nd Brekst Inns, by Willi J. Crroll, Ph.D., Betsy Goez,Ann Huen, Pel Lnier, nd Iris Lui

Vol. 6, No. 6 Developent nd Use o Web-bsed ool to Mesure the Costs o

Eployee urnover: Preliinry Findings,by iothy R. Hinkin, Ph.D., nd J. Brucercey, Ph.D.

Vol. 6, No. 5 ipping nd Its Alterntives:A Coprison o ipping, ServiceChrges, nd Service-inclusive Pricing,by Michel Lynn, Ph.D.

Vol. 6, No. 4 An Exintion o InternetInterediries nd Hotel Loylty Progrs: How Will Guests Get theirPoints?, by Bill Crroll, Ph.D., nd Judy A.Siguw, D.B.A

CHR ool 7 A Picture Is Worth Tousnd Words: Using Photo-Elicittion

to Solicit Hotel Guest Feedbck, by Mdeleine Pulln, Ph.D., nd StephniRobson

Vol. 6, No. 3 Copendiu 2006

Vol. 6, No. 2 Why Discounting StillDoesn’t Work: A Hotel Pricing Updte,by Lind Cnin, Ph.D. nd Cthy A. Enz,Ph.D.

Vol. 6, No. 1 Rce Dierences in ipping:Questions nd Answers or the ResturntIndustry, by Michel Lynn, Ph.D.

2005 ReportsVol. 5, No. 13 Eight Rules or Copetingin Hotel Rel Estte Mrkets, by JohnCorgel, Ph.D.

Vol. 5, No. 12 Biting O More Tn Tey Cn Chew: Unullled DevelopentCoitents in Interntionl MsterFrnchising Ventures,

by Arturs Klnins, Ph.D.

Vol. 5, No. 11 Te AggloertionConundru: How Co-loction HelpsSoe Hotels nd Hurts Others, by Cthy A. Enz, Ph.D., Lind Cnin, Ph.D., ndJerey Hrrison, Ph.D.

Vol. 5, No. 10 Low-price Gurntees:How Hotel Copnies Cn Get It Right,by Steven A. Crvell, Ph.D., ndDniel C. Qun, Ph.D.

Vol. 5, No. 9 Dining Durtion ndCustoer Stisction, by Breni Noone,

Ph.D. nd Sheryl E. Kies, Ph.D.

Vol. 5, No. 8 Quntiying Ipct:Te Eect o New Hotels nd BrndConversions on Revenues o ExistingHotels, by Arturs Klnins, Ph.D.

Vol. 5, No. 7 Best-vilble-rte Pricing tHotels: A Study o Custoer Perceptionsnd Rections, by Kristin V. Rohls ndSheryl E. Kies, Ph.D.

Vol. 5, No. 6 An Exintion o RevenueMngeent in Reltion to Hotels’ PricingStrtegies, by Cthy A. Enz, Ph.D. ndLind Cnin, Ph.D.

Vol. 5, No. 5 Inortion Syste Design:

A Systetic Wy to Anlyze I in YourBusiness, by Eric L. Wgner, Ph.D.,Gbriele Piccoli, Ph.D., nd ShronLouthen.

Vol. 5, No. 4 Perceived Firness o Resturnt Witlist-ngeent Policies,by Kelly A. McGuire nd Sheryl E. Kies,Ph.D.

Vol. 5, No. 3 Copendiu 2005

Vol. 5, No. 2 Why Custoers ShopAround: A Coprison o Hotel RooRtes nd Avilbility cross BookingChnnels, by Gry M. Topson, Ph.D.

nd Alexndr Filezger

CHR Reports Indexwww.chr.cornell.edu




www.chr.cornell.edu

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